Biden administration sued again over debt relief disproportionately shouldered by communities of color

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Washington, DC – A group of student, consumer and civil rights organizations filed a lawsuit Friday against U.S. Secretary of Education Miguel Cardona and the Department of Education on behalf of alumni Westwood College students who have been waiting almost six years for the department to award loan relief taken out by Westood’s misleading and misleading tactics.

Groups representing affected borrowers include Student Defence, the Lawyers Committee for Civil Rights Under Law (Lawyers Committee), and the National Center for Consumer Law. The trial, Hemphill versus Cardona, was filed in the United States District Court for the District of Columbia.

In November 2016, the Illinois Attorney General filed a class action Borrower Defense of Reimbursement with the Department of Education on behalf of defrauded students who attended Westwood College’s criminal justice program in Illinois. The class demand follows a settlement between the State of Illinois and Westwood that resulted in the cancellation of the institutional loans. However, the settlement did not affect federal student loans held by the Department of Education. The agency has since rely the Illinois Attorney General’s work to provide a subset of student debt relief, but never acted on the Illinois Attorney General’s request, leaving hundreds or even thousands of students encumbered by illegal student loans.

The research cited in the lawsuit highlights how students of color were disproportionately defrauded by Westwood’s misrepresentations. From 2004 to 2015, Westwood’s student population was approximately 44% Black and 21% Latinx, nearly three and one and a half times the average statewide enrollment among those groups respectively. The Department’s failure to act on the Illinois Attorney General’s request disproportionately denies aid to communities of color that are already facing increased levels of debt and economic insecurity.

“For nearly six years, in every jurisdiction, the Department has shied away from its obligations, leaving countless borrowers in the dark as to whether or when they will receive the relief due to them under the federal law,” said Director of Student Defense Litigation Eric Rothschild. “The Department has what it takes to free borrowers from financial limbo and give them a well-deserved fresh start. It is no longer time for them to act accordingly.

Earlier this month, Illinois Attorney General Kwame Raoul sent a letter to the ministry urging the agency to grant the Westwood Group’s borrower defense request. The letter outlined the department’s findings regarding material misrepresentations to students who enrolled at the institution.

“There is no more need for analysis or proof: Westwood defrauded every student who took his criminal justice program in Illinois”, Illinois AG Raoul wrote. “The Department – ​​and only the Department – ​​knows which defrauded borrowers continue to incur federal debt while in Westwood. These consumers continue to be harmed by the student loan debt they carry and its negative impact on their lives.

“As the Department delayed responding to the Illinois Attorney General’s request, borrowers have struggled under the burden of these loans, in some cases forced to choose between paying their student loan bills and paying for other necessities. like food and rent,” said Kyra Taylor, staff attorney at the National Consumer Law Center. “The Ministry of Education must act quickly when it becomes clear that a school has harmed students. This shouldn’t leave students in limbo paying off debts that should be cancelled.

This is the second lawsuit filed against the Department to resolve outstanding claims of the group’s borrower defense in the past two months. Last month, a group of consumer and student rights organizations — including Student Defence, the Project on Predatory Student Lending and the National Consumer Law Center — filed a trial against the Department seeking to resolve outstanding group borrower defense claims for students who attended the Kaplan Career Institute in Massachusetts.

“The Department of Education’s failure to act disproportionately – and unjustifiably – is failing low-income Black and Latino borrowers who are particularly burdened with unaffordable and unfair debt after generations of discriminatory and government-sanctioned policies. government that deprive communities of color of wealth,” said Genevieve Bonadies Torres, Associate Director of the Educational Opportunities Project with the Lawyers Committee for Civil Rights Under Law. “By neglecting its legal obligations to defrauded students who are entitled to redress, the Department’s inaction exacerbates existing racial disparities in academic achievement and economic opportunity.”

The Student Defense previously brought to light the stories of two defrauded Westwood College students – Jaime Murillo and Luis Tayahua – on “Bursts,“a website chronicling the devastating impact of predatory, for-profit college programs, produced in collaboration with the creators of the documentary failed state.

A copy of the lawsuit can be found here.